Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to the Fox Factory Holding Corp. third quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. Please note, this conference is being recorded. I'd now like to turn the conference over to your host, Vivek Bhakuni, Senior Director of Investor Relations and Business Development. Thank you, sir. Please go ahead. Thank you. Good afternoon, and welcome to Fox Factory's third quarter 2023 earnings conference call. I am joined today by Mike Dennison, our Chief Executive Officer, and Dennis Schemm, our Chief Financial Officer and Treasurer. First, Mike will provide business updates. Then Dennis will review the quarterly financial results and then the outlook, followed by closing remarks from Mike. We will then open the call up for your questions. By now, everyone should have access to the earnings release, which went out today at approximately 4 or 5 Eastern Time. If you have not had a chance to review the release, it's available on the investor relations portion of our website at investor.ridefox.com. Please note that throughout this call, we will refer to Fox Factory as Fox or the company. Before we begin, I would like to remind everyone that the prepared remarks contain forward-looking statements within the meaning of federal securities laws, and management may make additional forward-looking statements in response to your questions. Such statements involve a number of known and unknown uncertainties, many of which are outside the company's control and can cause future results, performance, or achievements to differ materially from the results, performance, or achievements expressed or implied by such forward-looking statements. Important factors and risks that could cause or contribute to such differences are detailed in the company's latest Form 10-Q and in the company's latest annual report on Form 10-K, each filed with the Securities and Exchange Commission. Except as required by law, the company undertakes no obligation to update any forward-looking or other statements herein, whether as a result of new information, future events, or otherwise. In addition, where appropriate, in today's prepared remarks and within our earnings release, we will refer to certain non-GAAP financial measures to evaluate our business, including adjusted gross profit, adjusted gross margin, adjusted operating expenses, adjusted net income, adjusted earnings per diluted share, adjusted EBITDA, and adjusted EBITDA margin. As we believe, these are useful metrics that allow investors to better understand and evaluate the company's core operating performance and trends. Reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures are included in today's press release, which has also been posted on our website. With that, it is my pleasure to turn the call over to our CEO, Mike Dennison. Thank you, Vivek. Good afternoon, everyone, and thank you for joining us on our third quarter 2023 earnings call. Today, I will discuss our strategy, operating highlights, and business activity. Dennis will then discuss additional details on our financial results, balance sheet, and outlook. After our prepared remarks, we will open the call for questions. While Fox's near-term results are clouded by the ongoing inventory recalibration in FSG and the impact of the UAW strike on both PVG and AAG's results, on a strategic level, our three pillars of growth continue to prove powerful and resilient. One, our industry-leading high-performance brands continue to win market share. Two, our research and development teams continue to innovate, generating a deep and disruptive product development pipeline. And three, our 1 + 1 = 3 growth mindset continues to drive top-line and bottom-line improvement. Innovation and brand strength are the heart of our company and core to our go-to-market success as our technology engineers continue to challenge the impossible and lead in the never-ending pursuit of maximum performance. By focusing on the world's best athletes and surpassing their demands, our team continues to outperform the competition, launching award-winning products and designs that propel champion Fox athletes across the globe to new heights. In FSG, Fox athletes, leveraging the highest quality products for the most extreme environments, dominated the Enduro and World Cup DH race season, winning 18 races and taking 89 podiums, more than any other suspension company. And it's not just Fox products that are winning. Recently, Race Face's Turbine Wheel was named Bicycling Magazine best mountain bike wheel for 2023. In our Powered Vehicles Group, the speed of innovation is accelerating as we commercialize 15 new vehicle suspension packages in 90 days. Over the last 2 quarters, we have launched more than 28 new packages, not only outperforming our nearest competitor, but far surpassing our own internal targets. We are at the top of our game, and the results from Fox athletes around the world are the proof. But our work is never done, and we will continue to invest in innovation and disruptive technologies to enable Fox athletes in the relentless drive to win. That same innovation is leveraging dramatic gains for us within and across our AAG portfolio as we drive our 1 + 1 = 3 growth thesis. When we purchased Custom Wheel House, we knew we were buying a superior brand with the best wheels in the business. But what we didn't know was how quickly their products would be integrated into the AAG family of businesses... The award-winning Method wheels are being integrated into our premium packages and systems across BDS, RideTech, and Powered Vehicle divisions, leading to better performance, aesthetics, and higher profitability. Our ability to find companies that act and operate with the same level of innovation, enthusiast loyalty, and a culture to drive a never-ending pursuit of maximum performance are the keys to our strategic growth and profitability. That's why I could not be more pleased to announce today that we signed a definitive agreement to acquire Marucci Sports, an industry-leading innovator, designer, manufacturer, and distributor of highly engineered, premium performance, aluminum, composite, and wood baseball bats, as well as other diamond sports products. Marucci checks all the boxes as we combine two leading brands that are disrupting their respective industries through innovation and technology. Building on the tradition of winning and creating the best performing products for the most demanding athletes, Marucci is unmatched as its Halo brands, Marucci and Victus wood bats, drive more than 56% market share with Major League Baseball pros. Marucci is a continuation of our diversification strategy, expanding our business away from OEs and into the aftermarket, and it is the epitome of our one plus one equals three strategy, having made several acquisitions, including Lizard Skins and Baum Bats, that are creating exponential growth vectors within our portfolio. We see a significant TAM opportunity for Marucci and the potential to unlock new growth vectors expanding far beyond diamond sports. Not only do we expect Marucci to be accretive to Fox's growth and EBITDA margin, but we are also excited about the synergy potential in metallurgy, manufacturing, and supply chain. While there is so much to be excited about with this deal, what inspires me the most is the similarities in our cultures. Having spent considerable time with the Marucci team, its authenticity is undeniable, and it's founded by and led by a collective group of former elite athletes and coaches. Walking the hallways and meeting employees, I honestly felt like I was in a Fox factory, where winning is everything and challenging the impossible happens every day. Turning to our operating highlights, sales in FSG hit a low water mark in the third quarter as expected, only contributing $72 million in revenue, as OEs continued to focus on depleting inventory through discounts and promotional activities. Actual sales were lower than our estimate for the quarter by approximately $25 million, as we saw slower buying patterns, especially in September, as consumers adjust to an environment of higher interest rates and costs, coupled with macroeconomic uncertainty. Both PVG and AAG experienced growth year-on-year of 12% to 8%, respectively, but declined sequentially by 12% to 13%, respectively, as the UAW strike impacted both groups. Legacy PVG was impacted by reduced shipments, given OE manufacturing site closures and OE supply chain disruptions, as well as a delayed launch of a new model just prior to the strike. AAG was impacted sooner than expected, as dealers were prioritized for chassis deployment over our outfitting group. In addition, we also received a weaker mix of chassis, which caused us to miss higher value content vehicles in exchange for lower content, lower priced packages. Between AAG and PVG, we estimate a reduction in sales of approximately $45 million in Q3 2023 versus our outlook. While we continue to address the near-term pressure on the top line, we delivered strong Adjusted EBITDA margins of 19.2% with lower revenue, marking the third consecutive quarter where our Adjusted EBITDA margins exceeded 19%. Our strong and consistent bottom-line performance and our ability to manage an exceptional balance sheet fuel our ability to allocate capital to unlock our one plus one equals three growth and diversification strategy. This consistent financial performance also resulted in our board of directors approving a share repurchase plan up to $300 million, providing us with another strategic use of our cash, returning value to shareholders. Authorization of a share buyback plan of up to 8% of our outstanding shares demonstrates our belief in the strength in our operating model and growth plans. With the UAW strike nearing a formalized settlement, our customers in AAG and PVG are enthusiastic about the future, given the innovative product offerings and go-to-market strategies that we are delivering. However, businesses in AAG and PVG were impacted throughout October, and we expect residual impacts in November as OEs work to restart supply chains and ramp manufacturing. In FSG, we continue to see softness as the channel works through inventory. We recently met with the CEOs and executive teams of our largest and most important bicycle customers. While they remain optimistic about the future, especially the acceleration of e-bike across various categories, they acknowledge that the path to new models and technology will be modestly delayed as they work their way through excess inventory in the channel. Additionally, we are seeing consumers grappling with a higher cost environment and our distributors cope with a higher interest rate environment by scaling back on inventory levels. Given these impacts, we are reducing our full year guide from the low end of $1.67 billion to $1.7 billion, to $1.3 billion to $1.47 billion. While we continue to work through the channel inventory recalibration in FSG and return to a more normalized run rate, our year-to-date growth in PVG and AAG of 35% to 16%, respectively, give us confidence in our growth thesis. The strength of our brands, our unrivaled history of innovation and discovery, the strong growth in automotive and powered vehicles, and the one + one equals three, TAM expanding the acquisition of Marucci, put us on a trajectory to accomplish our 2025 vision of $2 billion sales and 25% EBITDA margins. To conclude, we acknowledge the challenges in front of us, but at the same time, we are pleased with top and bottom line performance, thanks to the power of our brands, our customer loyalty, and our incredibly talented and dedicated team members. As our history has proven, no matter what the challenge is, we have always found ways to grow our business, be it through new product categories, adjacencies, geographies, or manufacturing efficiencies. With that, I'll turn the call over to Dennis. Thanks, Mike, and good afternoon, everyone. I'll begin by discussing our third quarter financial results and then move to our balance sheet and cash flows, our upcoming acquisition of Marucci, and our capital structure strategy, and then wrap up with a review of our guidance. Total consolidated net sales in the third quarter of 2023 were $331.1 million, a decrease of 19.1% versus sales of $409.2 million in the third quarter of 2022. The Powered Vehicles Group, PVG, delivered a 12.4% increase in net sales in the third quarter compared to the same quarter last year. This performance was negatively impacted in the weeks leading up to and after the UAW strike, given OE manufacturing site closures and OE supply chain disruptions, as well as a delayed launch of a new model. Our Aftermarket Applications Group, AAG, delivered an 8.2% increase in net sales in the third quarter compared to the same quarter last year. This growth was driven by sales from Custom Wheel House acquisition, which was completed in March 2023. Excluding Custom Wheel House, AAG sales declined 7.2% as OEMs temporarily provided chassis preference to dealers above our upfitting group, resulting in a chassis mix on hand that was associated with lower content and lower price point vehicles. Net sales in the Specialty Sports Group, SSG, decreased by 58.6% compared to the third quarter of 2022, due to the persistent level of high inventory across various channels. While we still expect SSG's Q3 performance to be the trough for the year, we expect the inventory recalibration to continue through the first half of 2024. We experienced slower demand across both AAG and SSG as dealers and distributors pulled back on inventory, given higher inventory carrying costs and as consumers adjusted to a rising interest rate in an uncertain macroeconomic environment. Fox Factory's gross margin was 32.4% in the third quarter of 2023, a 110 basis point decrease from 33.5% in the same period in the prior year. The decrease in gross margin in Q3 of 2023 is primarily driven by a shift in our product line mix and the impact of the UAW strike, offset by increased efficiencies at our North American facility. Our decision to protect our highly skilled workforce during the UAW strike also impacted our gross margins. Given the temporary, short-duration nature of the strike, this was the absolute right decision to take. Adjusted gross margin, which excludes the effects of amortization of acquired inventory valuation markup, organizational restructuring expenses, and strategic transformation costs, decreased 70 basis points to 33.2% versus Q3 of 2022. The sustainable manufacturing efficiency gains in PVG were another key ingredient to Fox's solid gross and EBITDA margin in light of a $78 million decline in revenue. Total operating expenses were $65.9 million or 19.9% of sales in the third quarter of 2023, compared to $71.9 million or 17.6% of sales in the third quarter of last year. Operating expenses were lower compared to the same quarter in the prior period, due to strong cost controls and continuous improvement, partially offset by the inclusion of Custom Wheel House operating expenses of $4.7 million, amortization of acquired intangibles and operating expenses associated with facility expansions. Adjusted operating expenses as a percentage of sales increased by 100 basis points to 17.6% in the third quarter of 2023, compared to 15.8% in the same period in the prior year. The company's effective tax rate was 9% in the third quarter of fiscal 2023, compared to 20.8% in the third quarter of fiscal 2022. The change in the effective tax rate was due to a benefit from R&D tax credits. Net income in the third quarter of 2023 was $35.3 million to $0.83 per diluted share, compared to $50.8 million or $1.20 per diluted share in the same prior year period. Adjusted net income was $44.8 million in the third quarter of 2023, a decrease of approximately $12.6 million, or 22%, compared to $57.4 million in the third quarter of last year. We delivered $1.05 of adjusted earnings per diluted share in the third quarter of 2023, compared to $1.35 in the third quarter of 2022. Adjusted EBITDA decreased by 25.1% to $63.7 million for the third quarter of 2023, compared to $85.1 million in the same quarter last year. Adjusted EBITDA margin decreased by 160 basis points to 19.2% in the third quarter of 2023, compared to 20.8% in the third quarter of 2022. The decrease in the adjusted EBITDA margin in the third quarter of 2023 is primarily due to the change in the product mix, the impact of the UAW strike, and cost increases associated with our facilities expansions to support our continued growth. Adjusted EBITDA margins were sequentially flat, even while sales decreased in the quarter, given our rigorous cost controls and continuous improvement mindset. Moving to the balance sheet and cash flows. Our balance sheet continues to be a source of strength for Fox and underpins our capital allocation strategy. We decreased inventory by $9.4 million, driven by our continuous improvement efforts to further optimize inventory levels across the organization. These efforts are significant, given the addition of $15 million of inventory related to the Custom Wheel House addition. Year to date, we generated $127 million in operating cash flows, $70 million more than the same period last year, and a sequential improvement of $129 million. Our net leverage is 0.5 times, with our revolver balance at $190 million as of September 30. Our flexible capital structure allowed us to efficiently access the accordion feature in our revolver to secure an incremental $600 million in pro rata Term Loan A debt to finance the Marucci transaction. The Term Loan A is coterminous with our existing revolver, and the interest rate is 50 basis points higher than our existing revolver. This incremental borrowing will provide us with significant flexibility to address our capital allocation priorities of investing in growth, both inorganic and organic, paying down debt, and returning value to shareowners. The merger with Marucci Sports represents our largest acquisition to date. We expect that Marucci will be accretive to our revenue and earnings, given its strong growth vectors and EBITDA margins of 25%. Marucci is core to our diversification strategy, providing for diversification within SSG with new products and end customers, and providing for diversification across our existing businesses as it is acyclical in nature. We expect pro forma leverage to be roughly 2.1 times after the transaction is completed. Our core investments in R&D continue to support our growth and margin profile. In PVG, our R&D efforts resulted in 15 new products just this quarter. In SSG, our investments continue to drive innovation, supporting podium-winning Fox riders. In AAG, we continue to invest in improving content and design for our off-road upfitting business and for our new business venture in side-by-side upfitting, where we are designing the premium, high-performance, state-of-the-art prototypes. Our revolver balance as of September 30th is $190 million versus $200 million as of December 31st, 2022. We paid down $170 million through the third quarter of fiscal 2023, given our strong operating cash flows, which more than doubled on a year-to-date basis. Our board of directors recently approved a $300 million share repurchase program. While we are a growth company at heart, we see sufficient capital to continue investing in innovation and efficiencies, which will drive organic growth in a thoughtful and disciplined approach. Given the current macroeconomic environment and our strong cash flow generation, we believe using a portion of our free cash flow to manage dilution and to opportunistically repurchase shares is a strategic use of our capital. Now, I'd like to share some select guidance. While we are pleased that the Big Three have reached a tentative agreement with the UAW, our fourth quarter results have already been impacted, both in AAG and in PVG, and we expect to see additional impacts as the OEMs work through supply chain inefficiencies as they bring up their manufacturing facilities. Additionally, we are facing headwinds due to the higher interest rate environment and macroeconomic outlook at the consumer level and at the dealer distributor level, as the cost of carrying inventory is more expensive. While SSG hit trough revenues in Q3, the inventory recalibration is taking longer than anticipated, and we expect fourth quarter revenue to be up modestly on a sequential basis. For the fourth quarter of 2023, we expect sales in the range of $300 million-$340 million and non-GAAP adjusted earnings per diluted share in the range of $0.75 to $1.00. For the fiscal year 2023, the company expects sales in the range of $1.43 billion to $1.47 billion, and adjusted earnings per diluted share to be in the range of $4.20 to $4.45. Our full year guidance assumes an effective income tax rate to be in the range of approximately 15%. We are certainly operating in a dynamic environment and will continue to watch retail and consumer trends to adjust our cost and business model accordingly. However, because of our strong and flexible capital structure, we are working from a position of strength during this downturn and investing in growth with new products in SSG and PVG, in content for our upfitting business, production capabilities in our Outside Van and new side-by-side facilities, and furthering distribution for Custom Wheel House and Shock Therapy as we see tremendous opportunity for longer term growth and profitability. With that, I'd like to turn the call back over to Mike. Thank you, Dennis. As we close out a challenging third quarter, I am confident in the diversity of our portfolio, the capability of the management team, and the future of our brands. I am pleased with our strong financial performance, even with the top line miss, as we weather the impact of the UAW strike and the persistent channel inventory recalibration in SSG. The relentless drive to win within our culture and by our people gives me deep inspiration and confidence in our future. Armed with a strong balance sheet and cash flow, a newly authorized share repurchase program, and our TAM unlocking technologies and growth vectors, I remain incredibly excited about our positioning and future. I would now like to open the call for questions. Operator? Thank you, sir. At this time, if you would like to ask a question, please press the star and one on your telephone keypad. You may remove yourself from the queue at any time by pressing star two. Once again, that is star one to ask a question. We will pause for a moment to allow questions to queue. Our first question comes from Larry Solow, CJS Securities. Great, thanks. Good afternoon, guys. I guess- Hey, Larry. First, I guess, first question, Jeff, just on Marucci, certainly a surprise, a little bit, I guess, an adjacency for sure. Is it just simply the enthusiast culture, the strong brand? I know Marucci well, I know the CAT X, so I know a lot about this, but I'm just trying to kind of, you know, tie the bow there and just, you know, figure out exactly, you know, what drove you to this acquisition. Yeah, Larry, good question. You know, we've been looking for the right brand, the right product in specialty sports for a long time. As long as you and I have been talking, we've been looking for the right fit. What we found with Marucci is a bunch of really great things. One. First and foremost, it's a highly engineered product. It's really designed from the top down, meaning with the pro athletes down to the little leaguers, as you said, with the CATX -10. So these are highly engineered products. They leverage aluminum and composite in everything but the major leagues. So obviously, that's what we do for a living, in aluminum and composite materials. So the synergies that we can create in design, engineering, and manufacturing are pretty significant on a long-term basis. In addition, you know, when we walked the halls of Marucci and met their leadership team, their culture, their passion, the way they think about the business, the fact that most of them come from major leagues or you know, being scouts or college players or softball players, it's. Mm-hmm. It's us. It's literally us. Yeah ... with a different name. And, and so when you think about the product, you think about the engineering, you think about the, the pro athlete first, down to the weekend warriors, or in this case, the little leaguers, and then you think about the culture, and then you think about the financials, which are accretive, both from an EBITDA perspective and from a revenue perspective. You look at it and you go, "You know what? This checks all the boxes. This is the best, this is the best thing we have seen for specialty sports since, you know, since I've been the CEO," and we were just thrilled to add them. So this is, this is a great day for us. Okay. And it looks like, if my math is right, you're paying about 11.5 times trailing EBITDA. I happen to follow their owner, Compass, so that's how I know that. And is that going to be immediately accretive? I know you guys said accretive. Is that immediately accretive? Yeah, I'll, I'll let Dennis weigh in, too. We'll get the financials out. You'll see kind of how that all gets structured. It's in line with most of our, our multiples that we paid for the businesses that we've bought. So, Yeah. It might not be quite right, but I'll let Dennis speak to kind of the accretive nature. I mean, this, this is definitely accretive for us, both on the revenue line, on the EBITDA line. I mean, we're seeing EBITDA margins, roughly speaking, around 25%. So that's higher than our flagship as well, so... And then we start getting into the one plus one equals three mentality here, this thing explodes. So this is- Right. They are the epitome of a one plus one equals three already, right? So when you look at what they've done over the past couple of years, they've brought on Victus, Lizard Skins, Baum Bats, and you wrap those things together, you start to grow that business pretty rapidly. So- Sure ... that's just on the top line. And then when I look at the bottom line here, there's some vertical integration that really gets me excited as well with, you know, the bat wood manufacturing, and then on the supply chain side of things, where these guys cranked it when it came to, ... When it came to the pandemic time frame, and nobody else could deliver, their supply chain kicked it into gear. They won a lot of shelf space during that time. So again, another synergistic play for us because we did so well with SSG during the pandemic as well, when no one else could deliver. A lot of good synergies here. Yeah, got you. And if I could just switch gears real fast, just onto SSG, and obviously, you guys called, you know, the bottom, obviously, a little bit lower this quarter. It still feels like there's still some inventory in the channel and still some other issues. Clearly, you're gonna grow next year from these levels, but Mike, on the last quarterly call, I think you had kind of thought you can get back to 2021 levels, right? Or 2022, ex that extra $100 million. I know you don't wanna give guidance for 2024 now, but any just broad, you know, brush color on that would be great. Yeah, what we're seeing when we talk to the CEOs and executives of the bike companies is some are in great shape. Some actually are growing with us right now, which is kind of hard to believe in the current, you know, environment. But those companies that really control their manufacturing, most of the manufacturing is in-house, they have good control of their supply chains. Other companies are still projecting that they're in an inventory glut situation through the first half of next year. So as we look forward, we see kind of the first half being softer than we'd like, and then finally kind of kicking it into gear in the second half. So we're not gonna give guidance. I still think those long-term projections are right. You know, how they hit us and when they hit us in 2024, I think we'll have to, you know, keep working to figure out. And as you know, Larry, the challenge right now is your vision or your view of the quarter we're in or the next quarter we're going into is pretty short. It's about 45 days right no Right. We're still collecting information as we think about Q4. Okay. Pretty hard for me to give you a really good, you know, clarity on Q1 and Q2 just yet. No, it's fair enough. Okay, thanks so much. I appreciate it, guys. Thanks, Larry. Our next question comes from Jim Duffy, Stifel. Thanks. Hi, guys. Hello. So a big lift package with the acquisition of the bat company. Still working on it- Yeah ... but there has to be a good title for my note in there somewhere. Let's set the quarter and- Contest. Do you wanna enter our contest? We're seeing who comes up with the most clever line, so. Let's set the quarter and near term aside just for a moment. You know, from a very strategic level and looking over a multiple year period, what's changed with respect to your outlook for the automotive and bike opportunity that says allocation of capital to a totally different business is the best course? Yeah, the allocation of capital is still, has stayed intact for our PVG and AAG businesses. You know, we're gonna continue to be acquisitive, and we're gonna continue to grow those businesses, and we're gonna do the same in bike selectively. You know, the challenge right now in bike is a lot of the businesses that are open or potentially acquirable are still trying to figure out their own inventory situations. They're trying to figure out their go-to-market strategies. You know, as within the bike industry, Bosch stands out as probably one of the leaders in both top and bottom line performance relative to the other companies, most of them are private. You know, we've got a great business inside of that industry, and as you know, we've always been trying to diversify and really actually make SSG what we call it, Specialty Sports Group. This was the right opportunity and the right time to go diversify in that space. It doesn't take anything away from finding good acquisitions, good targets, and allocating capital where appropriate in the other businesses as well. The best thing we got going for us is a great balance sheet and the opportunity to be selective in those investments and very critical of the investments we make. Okay, again, you know, kind of with that longer-term view and thinking specific to the upfitting business, you've seen kind of a stall in that business in the near term, and I understand the UAW strike impact. But what are the prospects for that business as you look out to 2024, 2025? What do you see as the incremental drivers? What are the things you're really enthused about there, and what are the risks to kind of achieving on those opportunities? Yeah, it's a little bit clunky right now, as you said. So I whether, you know, it's just gonna be that way for a few months or a quarter while we work through this strike impact. But, you know, that broader PVG upfitting business is so important to us. You know, a couple of things: One, Outside Van, we're getting that new facility up and running for production, so we're still deep in the middle of that process. Dennis and I were just out there about a week ago, you know, meeting with the team, understanding where we're at and growing that part of the business. We then went to Phoenix, to our side-by-side upfitting business, which is just getting launched. I'm telling you, Jim, that, and I've talked to you about this before, I think that side-by-side upfitting business is going to just absolutely crush it. In fact, you know, our partners in that business, like Polaris and some of our distributor dealer partners, are thrilled about what we've designed and developed. I think in 2024, that's gonna be a major player for us in upfitting. Then the other thing we're seeing in upfitting, which is really interesting, is that while volume of units might be down, if we get the right chassis mix, the content on the vehicles is going up. Our ability to actually sell higher priced vehicles with more content seems to be much more recession resistant than that on the low end, where we're adding smaller packages, less content and more the middle market vehicles. So it really benefits us as we think about the engineering and all the content we can add to these vehicles, to continue pushing that upper end of that upper limit, which is good from both a top line and a profitability perspective in that business. And as you know, because we talked about it, outfitting business for us is the higher end of our margin range. So we're doubling down. We're nothing else about it, we're going to double down on that business and keep growing it. Thanks. I have to ask one on the bat business. Just given the pandemic, how do you know you're not acquiring a business that's, you know, overearned for a period? Do you have a comparison to 2019 that you can reference to? Just give us comfort that you have some visibility into that business continuing to grow. Yeah, that business has continued to grow across the Little League and in softball, but it's got a lot of room to run. I mean, there's a lot of room, especially all the way up into college, by the way. And then we've got some international expansion in Korea and Japan, a little bit in Taiwan, that we think is very interesting. You know, what we saw is that there was definitely a return to baseball and return to baseball grew significantly this year in a post-COVID world. Kids are out there playing more and more in the field and picking up these bats. And the price points of these pieces of equipment are also going up very nicely. So when I look forward in the next 3 to, you know, 4 or 5 years of what we can actually see in front of us, I think this business has really good growth, better than our bike business growth, you know, especially obviously now. But it's got good growth in the next 3 to 5 years, and I think there's a lot we can go do. So I'm real confident where this business goes, and I don't think there's necessarily a COVID bump in baseball. It's actually the opposite. I think it got better post-baseball, post-COVID, when people could return to the sport kind of en masse. Okay, thank you so much. Our next question comes from Anna Gleason, B. Riley. Hi, thanks for taking my question. I guess- Hey, Anna. Touching on SSG for the fourth quarter, I think on the last call, you talked about expecting sequential improvement as OEMs prepare to launch next year's or next model year product. It sounds like that's going to be delayed a bit given the level of inventory in the channel. Is that something we should be expecting in the beginning of 2024? But then you mentioned that channel normalization could extend through the first half. So when should we expect that new product to- We are seeing- -ship? Yeah, Anna, it's a good question. We are seeing, you know, some customers, some are, like I said earlier, some are better OEMs who have managed inventory very well, roll out their new model year, so that's helping us in Q4. But as Dennis pointed out in his script, it's fairly moderate growth in Q4 over Q3, which is a reflection of other OEMs who are struggling, you know, more significantly in the quarter and canceling some of their production plans, in this quarter that they had, you know, committed to earlier in the year. So that's really the mixed shift that's going on in Q4. Everybody's just trying to get rid of all the old components and products in their, in their inventories. And everybody knows that if they, you know, if they didn't do a 2024, they really can't afford to not do a 2025. So when we think about when do people really have to be out there with new bike models, think spring of 2024, they have got to have solved this problem. And I mentioned earlier in one of the questions about, you know, getting through the inventory by June. Those things are tied together. They have to eliminate the inventory, so they don't miss another model year, as that'll be pretty, that'd be pretty dramatic to their businesses. Got it. Thanks. And then touching on the fourth quarter guidance, would it be possible to parse out what the UAW impact is assumed to be? Yeah, I mean, we can sure try. I don't. It's going to be fairly significant, obviously. What we're finding out is that even though the tentative strike ended at the end of October, so you'd think, okay, October was the down month, and that'd give you a pretty finite number. The challenge and the reason why I'm hesitant to answer it is because it depends on the pace that they restart up these factories. And it's not linear, and it's not real clean. So my opinion is, we're going to see the impact of these strikes through November, and then we're going to get to the holidays. So the reason for our conservative guide in Q4 is because while I think we can get through the implications of the strike in November, we're going to run right into the holidays after that, and then that's just a whole another problem. So we're not real positive on the automotive OE part of our business in Q4. Got it. And just following up there, are you expecting that chassis availability will be back to normal by the end of 2023, or could this extend into 2024? Generally speaking, I think it'll get back to normal by the end of the year. You know, there's the challenges that we faced throughout the year with getting, you know, these new models launched, whether it was the Bronco or other vehicles, which we really want to see in our operating business in 2024. You know, my assumption is, we're going to get through most of this in 2023, and it won't be an issue in 2024 at all or mixed. Okay, thanks. Our next question comes from Mike Swartz, Truist. Hey, yeah, good evening, guys. Maybe just to start on the Marucci acquisition. I think you said the business is accretive to both growth and margins just throughout the 25% EBITDA margin. Could you give us a sense of what, you know, the baseline is for revenue there, and then what the longer-term outlook for growth would be on the top line as well? ... Yeah, it's a little early for that right now, given the fact that, you know, we don't, we don't have a closing date yet, right? So, I'm gonna shy away from that a little bit, but this is a strong growth vector for us moving forward. And these EBITDA margins, I mean, we've hit them deep, and we understand them very, very well. They're very real, very achievable margins, and that's why, you know, without, without hesitation, we're saying this is accretive from the, from the EBITDA margin side for us going forward. They have a fantastic vertical integration strategy right now, and then we see synergies down the road with them on the raw material sourcing side, supply chain side, and manufacturing as well. Needless to say, I would assume you're not reflecting any benefit from Marucci in your fourth quarter guidance. That is absolutely correct. There is nothing, nothing in the guide for Marucci. Oh, okay, great. And then switching over just to maybe the impact of the auto strike. Obviously, there's a lot of, you know, elements of this that should be temporary in nature. But as we think about, you know, their cost structures and the higher labor costs, is there any risk that they start getting more aggressive with contractual negotiations and pricings with some of their vendors? You know, we haven't seen it, Mike. I would question the same thing as you, so I think it's a good question you're asking it. I will tell you that, you know, as our strategy continues with OEMs, it's to drive innovation and technology. And the new dual valve product that we're selling on the upcoming Raptor platform is our most expensive and most technologically advanced product that we've ever made. So we're gonna continue to push those price points up because we're gonna make better and better product, versus going down, you know, downstream to make cheaper products. And keep in mind, where the elasticity is for most of these OEMs is on those types of vehicles. So there's less pricing pressure for them there than there is probably in the bottom end of their lineup. So, I think we're gonna get less pressure just for those reasons. Okay, great. Thanks. Our next question comes from Alex Perry, Bank of America. Hi, thanks for taking my questions here. I guess maybe I just wanted to clarify. So the impact of the UAW strike on the quarter was in the tune of $45 million. Did you mention that? And then, I know you gave some qualitative context on sort of the 4Q impact of the UAW strike. But is it fair, like, if we were to take, you know, how much you lowered your guidance by, is there a way to sort of contextualize, you know, how much of that was sort of SSG and that coming in under what you thought, versus, you know, quantifying the impact of UAW? Yeah, no, I think that's a great question. So I think in Q3, you know, in, in Mike's prepared remarks, he talked about it being around $45 million impact from the strike. And so that was pre-strike and post, you know, and, and post-strike in the quarter. When we look to Q4, the way I was pretty much thinking about it is probably got another $25 million or so relative to SSG, and just the slowing of that business there as we continue to grind through that inventory recalibration and working with our distributors and OEs. And then the remainder, and this is where it gets, it gets difficult, right? Because there's the UAW impact. All of November was, you know, all of October was essentially impacted. Some of November is going to be impacted as they start to ramp back up. So it's challenging there to really nail that down. But then there's also what I'd call the macroeconomic interest rate environment that is causing dealers and distributors to hold less inventory. They're not leaning in as much because the carrying cost of this inventory is that much more expensive. So that's how I'm thinking about it. But, you know, for rough math, I mean, that $25 million for SSG, $100 or so is a combined, you know, UAW impact and this macroeconomic overhang. Alex, one of the things that Dennis said, I wanna double-click on, which I think is important to understand, is when we think about, you know, what the interest rate does to us, when we get lots of questions, I know you've asked in the past, what's the interest rate do to your buyer of a vehicle, or your buyer of a bike, or your buyer of one of our products? And we've always said, you know, our, our buyers are typically more affluent, and they tend to, you know, buy at the high end of the range, at least, products, kind of, regardless of the interest rates, because they're, they're cash buyers. Interestingly enough, what we saw in the, you know, kind of post-Labor Day, you know, September, and what we're seeing in Q4 is it's not-- obviously, the consumer is under pressure, but just as importantly, whether you're a car dealer or a bike dealer or, you know, a distributor in our business, you're having to finance your inventory and your floor plan. And what we really saw was those interest rates climbing so significantly that nobody wants to hold inventory. Somebody would have held a quarter's worth of inventory in the past, maybe they want to hold a month at most. So it's a nuance in this weird environment that we're all in, that we're all kind of learning about. And, so, you know, Dennis's comments were great in that there's other things also playing out here... that we're trying to rationalize and understand. Yeah, we're acting no different, right? I mean, think about what I highlighted on the call. We talked about drawing, you know, taking our inventory down another $9 million, right? Why are we doing that? The cost of capital is much more expensive today. So you take a look at what we're paying on rates today versus what it was a year and a half ago, it is dramatically different. So our focus is on the balance sheet, right? And rightly so. And guess what? So are our distributors and dealers as well, and same within customers. Yep, that's really helpful. Would you say that the impact in terms of the higher rate environment impacting the carrying of inventory is most pronounced in the upfitting versus, you know, the your bike retailers? Like, is that really where you're seeing the impact? Like, they're, you know, only willing to, you know, carry X amount of trucks versus Y last year. And then just my second question is just a little more help on, on SSG as we move through 2024. I know the sort of long-term guide there is mid- to high-single digits. Sounds like 1H 2024 is challenged. Does that mean, you know, up versus, like, down year-over-year? What does, what does that sort of mean? Thank you. Alex, I'll give Dennis the second half of that. I'll take the first half of it. It's actually pretty much across the board. When you think about, you know, how dealers are responding, and one of the things you'll see in bike, as an example, is that dealers are taking down their inventories as quickly as they can so they can be more nimble. You also see OEMs who are trying to flush this bike inventory through the system. In a lot of cases, they're doing it online direct, and they're discounting it heavily. So that's just. You can kind of see it play out, that the dealers don't want to hold the inventory, so the OEMs are kind of taking it into their own hands to push it through with big discounts as fast as they can in a direct-to-consumer fashion. I do agree with you, though, that dealers in automotive, you know, floorplan financing is a significant issue. And I'd say it's not just automotive, it's also in powersports. And we're seeing some of that play out in some of the comments that we get from our customers in that space as well. Dennis, you have the second half. Yeah, on the bike side of things, right, as Mike mentioned, we are seeing some OEs doing a really good job here, and they are growing with us, and they're continuing to grow in the back half of this year and into the first half of next year. But the way I would contextualize this is, if you take a look at the back half of 2023, I'd say we'd be up modestly in the first half of 2024. So that, you know, and then this is going to help with bikes and business overall as they start to grow and move into those 2024 models, 2025 models in the second half of 2024. That's our expectation. That's incredibly helpful. Best of luck going forward. Thanks. Just a reminder, to ask a question, please press star one. Our next question comes from Craig Kennison, Baird. Yeah, thanks for taking my question. I wanted just to ask quickly about the quarter itself. R&D spend was down dramatically. I'm wondering if that was a timing dynamic or if that's an area where you elected to cut costs? Yeah, we are not going to cut costs when it comes to R&D for CapEx back into the business or with our sales and marketing spend. That is, going forward, one of the most important things we can do to continue to grow and command the higher margins, you know, down the line. So what you saw there was basically, you remember we talked about the tax rate being lower in Q3. This was R&D tax credits coming through. Yeah, Craig, if we're gonna cut back, we're gonna cut back on infrastructure. We will not cut back on R&D and sales. Those are two key elements of our business that that get capital allocations before anything else. So that tax benefit comes through on the R&D line? What's that again? Sorry. Does the tax benefit... I'm sorry, does the tax benefit come through on the R&D line? Well, I was just saying that's part of it. There was, there were some credits that came through that basically offset some of the spend there in that line. Okay, thank you. As it relates to the Marucci transaction, just I guess my question is, what can Fox add to that business that CODI could not? Yeah, so we're a manufacturing company, and we have a lot of respect, obviously, for CODI. We've got a long history with CODI. If you know our story, and I know you do, Craig, but one of the things that Elias and I talked about, Elias is the CEO of CODI, is that while they can help support and guide a company like Marucci, and Victus and Baum, the other companies, we can really go after it from a manufacturing perspective and a supply chain perspective, because that's what we do every day. And you know, the biggest percentage of their bats are aluminum and/or composite, which is basically most of our materials as well. And we're a global manufacturer, just like Marucci is. So there's a lot we can do for them from that perspective. Then the other side of it, we're in the business of working with pro athletes. Ours are racers, typically, not baseball players, but you know what? There's not that much difference in how you use, you know, our marketing leverage, our marketing strength, our brand strength to go drive incremental benefit and value in that business. So we're excited about that as well. And, you know, we're just a growth engine. So, you know, our ability to lean in and work with the, with that team is going to be, I think, really compelling. And I think there's a lot we can do. So, you know, there's nothing against what CODI built, that company is fantastic. So I'm really impressed with what they've done in the three years that they owned them. Now that we've got the ball or the bat and ball, so to speak, you know, we're gonna crush it. I'm really excited what the next 3-5 years look like. Great. Thank you. We have no further questions in the queue at this time. I would now like to turn the call back over to Mike Dennison for any concluding remarks. Yeah, thanks, everybody. Appreciate the time tonight, and we'll see you guys all at the ballpark. Talk soon. This does conclude the Fox Factory Holding Corp. third quarter 2023 earnings call. You may now disconnect your line and have a great day.